Patriot Coal employs around 4,200 people and bears financial responsibility for five times that many retirees. To no one's surprise the company is in debt by 2010 and as a result ultimately forced to file for bankruptcy by 2012.
Corporations have backed out many times before on promises for pensions and retiree medical benefits. This, however, is a new low on that old scam. It is disturbing because what the bankruptcy court approved provides a method for companies aiming to reduce costs by abandoning their commitments to retirees. It is a deception that must be stopped.
The bankruptcy judge involved in the situation approved a system under which Patriot would change that commitment with a $300 million fund—a fund worth less than 19 percent of what was promised the retirees. Also, Patriot would place in the fund royalty payments that the bankrupt company contends could be worth “tens of millions” of dollars. Finally, the UMWA would receive 35 percent ownership of the bankrupt company—an “asset” the court contended could be sold to help support the retiree health care fund.
When employers promise pensions or retiree health care, workers count on it as deferred compensation. Deferred compensation is defined as money earned now but received later. When a bankruptcy judge approves rescinding those earned benefits, the court grants the company permission to take money out of workers’ wallets.
This is a crime that bankruptcy courts should prohibit. Especially when it has clear the failed company was set up to fail and ultimately robs retirees and workers of earned benefits.
Sign this petition and support the rights of the coal miners and retirees of Patriot Coal. They deserve and are entitled to their benefits. Demand that Patriot Coal compensate their workers and retirees despite their bankruptcy ruling.